Bombay High Court Judgments — 2022

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. In contrast, Section 4 of the Relaxation Act, which falls under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, was the provision that amended the Act, and this was done by the Legislature itself. Therefore, the Court agreed with the petitioners that Section 3 did not envisage amendments to the substantive provisions. The Court further held that even if the Explanations were assumed to be valid, the impugned notices were still bad in law because they did not comply with the amended Section 147, which no longer recognizes the concept of 'reason to believe' for assuming jurisdiction, and also failed to follow the procedure under Section 148A. The Court also found that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years as the time limits for issuing notices for these years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court allowed the writ petitions. It held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was merely a relaxation provision for time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the impugned notices were invalid for multiple reasons: (a) the Explanations were ultra vires; (b) even if the Explanations were valid, the notices were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; (c) the mandatory procedure under Section 148A was not followed; and (d) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act, and it did not grant the power to the Central Government to amend substantive provisions through notifications. The Court further found that even if the Explanations were considered valid, the impugned notices were bad in law as they did not comply with the amended Section 147, which requires compliance with Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend or revive substantive provisions of the Income Tax Act that had been repealed by the Finance Act, 2021. The Court noted that Section 4 of the Relaxation Act, which did amend provisions, was enacted by the legislature directly. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were bad in law because they were issued based on the erstwhile Section 147 (requiring 'reason to believe') and failed to comply with the amended Section 147 and the mandatory procedure under Section 148A. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was made by the legislature itself. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147, which empowers the revenue to reopen assessments subject to Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure under Section 148A was not followed, rendering the notices invalid. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, was a relaxation provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act. In contrast, Section 4 of the Relaxation Act, which falls under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, was the provision that actually amended the Act. The Court agreed with the assessee that only Section 4 amended the Act, and no such amendments were envisaged under Section 3. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they failed to comply with the amended Section 147 (which does not recognize 'reason to believe') and the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court relied on decisions of the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were invalid; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A had not been followed; (c) the 'reason to believe' standard, which was no longer recognized in the amended Section 147, was the basis for issuing the notices; and (d) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years, meaning the period of limitation for these years could not be extended. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend the Act, was enacted by the legislature itself. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still invalid because they did not comply with the amended Section 147 of the Act. The Assessing Officers had incorrectly relied on the 'reason to believe' concept, which is obsolete under the amended Section 147, and had failed to follow the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory procedures.

The Bombay High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was enacted by the legislature itself. The Court found that the impugned notices were bad in law because they were issued based on the erstwhile Section 147, which is no longer recognized in the amended Section 147, and that the procedure under the amended Section 148A was not followed. Additionally, the Court noted that the Relaxation Act was not applicable to assessment years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which did amend the Act, was distinct and made by the legislature itself. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still invalid because they were issued based on the erstwhile 'reason to believe' standard under Section 147, which is no longer recognized in the amended provisions, and because the mandatory procedure under Section 148A was not followed. The Court also found that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Court permitted the Assessing Officers to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the power to amend or revive repealed substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend the Act, was distinct and its provisions were not invoked through these notifications. The Court also found that even if the Explanations were valid, the notices were bad in law because they did not comply with the amended Section 147, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. Furthermore, the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not authorize amendments to substantive provisions of the Income Tax Act, unlike Section 4 which did amend the Act. The Court found that the Assessing Officers had assumed jurisdiction based on the 'reason to believe' principle, which is no longer recognized under the amended Section 147 of the Act. Additionally, the Court noted that the procedure under the amended Section 148A had not been followed, rendering the notices invalid. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision concerning time limits and did not grant the power to amend substantive provisions of the Income Tax Act, which was the domain of Section 4. The Court found that the notices were also bad in law because they were issued based on the 'reason to believe' concept, which is no longer recognized under the amended Section 147, and because the mandatory procedure under Section 148A was not followed. The Court further noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4 which did amend certain provisions. The Court found that the Explanations did not cover the erstwhile Section 147, which is the basis for assuming jurisdiction for reopening. Moreover, the Court noted that even if the Explanations were valid, the procedure under the amended Section 147 and Section 148A had not been followed. The Court also agreed that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the law.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, only deals with time limits and does not grant the power to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amends the Income Tax Act, falls under Chapter III and was enacted by the legislature itself. The Court also noted that even if the Explanations were considered valid, they did not cover Section 147, and the mandatory procedure under the amended Section 147 and Section 148A was not followed. Additionally, the Court found that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were invalid for multiple reasons: (a) the Explanations were ultra vires; (b) the notices were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; (c) the procedure under Section 148A was not followed; and (d) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4 which was enacted by the legislature itself. The Court found that the impugned notices were bad in law for multiple reasons. Firstly, they were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147. Secondly, the procedure under the amended Section 147, which is subject to Sections 148 to 153 (including Section 148A), was not followed. Thirdly, the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limit for issuing notices for these years was not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, the Court quashed and set aside all impugned notices. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory provisions.

The High Court allowed the writ petitions, quashing and setting aside all impugned notices issued under Section 148 of the Act. The Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires, bad in law, and null and void. The reasoning was that Section 3 of the Relaxation Act, which fell under the chapter titled ‘Relaxation of Certain Provisions of Specified Act’, was a relaxation provision dealing with time limits and did not empower the Central Government to amend or revive repealed substantive provisions of the Income Tax Act. This power was not delegated. The Court agreed with the assessee that only Section 4 of the Relaxation Act amended the Act. Furthermore, the Court found that even if the Explanations were considered valid, the notices were still bad in law as they did not comply with the amended Section 147 (which no longer recognized 'reason to believe') and the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. The Court directed that it would be open for Assessing Officers to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, after strictly complying with the statutory provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was merely a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which dealt with amendments to the Income Tax Act, was enacted by the legislature itself. The Court further held that even if the Explanations were considered valid, the impugned notices were invalid because they were issued based on the 'reason to believe' criterion, which is no longer recognized under the amended Section 147, and the mandatory procedure under Section 148A was not followed. Additionally, the Court found that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower amendments to the substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Explanations sought to apply the erstwhile Sections 148, 149, and 151 but did not cover Section 147, which is the empowering section for reopening. Consequently, the notices issued were invalid as they did not comply with the amended Section 147 (which no longer recognizes 'reason to believe') and the procedural requirement of Section 148A. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years as the time limits for these years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. All impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled 'Relaxation of Certain Provisions of Specified Act', was a relaxation provision dealing with time limits and did not grant the Central Government the power to amend substantive provisions of the Income Tax Act. In contrast, Section 4 of the Relaxation Act, which amended the Act, was enacted by the Legislature itself. The Court agreed with the assessee that only Section 4 amended the Act, not Section 3. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they were issued based on the erstwhile Section 147's 'reason to believe' concept, which is no longer recognized in the amended Section 147. Additionally, the mandatory procedure under the amended Section 148A was not followed. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee's contention that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court further found that even if the Explanations were considered valid, the impugned notices were still bad in law because they were issued based on the 'reason to believe' clause from the erstwhile Section 147, which is no longer applicable under the amended Section 147. Additionally, the mandatory procedure under Section 148A, which is part of the amended provisions, was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-16 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was made by the Legislature itself, and no such power was delegated to the Central Government. The Court also found that the impugned notices were bad in law as they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the amended Section 147, which is subject to Sections 148 to 153, including the procedure under Section 148A. Additionally, the Court noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the power to amend substantive provisions of the Income Tax Act, 1961. Such amendments were contemplated under Section 4 of the Relaxation Act, which was enacted by the legislature itself. The Court also found that even if the Explanations were valid, the impugned notices were invalid because they did not comply with the amended Section 147, which no longer recognizes the 'reason to believe' criterion, and the mandatory procedure under Section 148A was not followed. Furthermore, the Court noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires the Taxation and Other Laws (Relaxation of Certain Provisions) Act, 2020, and therefore, bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower amendments to substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the impugned notices were invalid because they were issued based on the repealed provisions and failed to comply with the amended Section 147, which mandates adherence to Sections 148 to 153, including the procedure under Section 148A. The 'reason to believe' clause, used in the notices, was no longer recognized under the amended Section 147. Additionally, the Court held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limits for issuing notices for these years were not expiring within the period covered by Section 3(1) of the Relaxation Act. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act. The Court was in respectful agreement with the views of the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 of the Relaxation Act did so. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because the Assessing Officers assumed jurisdiction based on the erstwhile 'reason to believe' concept, which is no longer recognized under the amended Section 147, and failed to follow the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct and made by the legislature itself. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations sought to revive repealed provisions without legislative backing; (b) even if the Explanations were valid, the procedure under the amended Section 147 and Section 148A was not followed; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were given liberty to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not grant power to amend substantive provisions of the Income Tax Act. It was noted that Section 4 of the Relaxation Act, which did amend the Act, was distinct and did not delegate amendment powers to the Central Government. The Court further found that the impugned notices were bad in law because they were issued based on the repealed 'reason to believe' concept under Section 147 and failed to comply with the procedure under the amended Section 147 and Section 148A. Additionally, the Court held that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, was a provision dealing with time limits and did not grant the Central Government the power to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which falls under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, was the provision that amended the Act, and such amendments were made by the Legislature itself. The Court agreed with the petitioners that only Section 4 amended the Act and Section 3 did not envisage amendments to substantive provisions. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they were issued based on the erstwhile Section 147 (using 'reason to believe') and failed to comply with the amended Section 147 and the mandatory procedure under Section 148A. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 or any subsequent year because the time limit for issuing notices for these years was not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 of the Relaxation Act did so. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147. Consequently, the notices were invalid because they were issued based on the repealed concept of 'reason to believe' under the erstwhile Section 147 and failed to comply with the mandatory procedure under the amended Section 147 and Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. All impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires, bad in law, and null and void. The Court agreed with the assessee that Section 3 of the Relaxation Act is a relaxation provision for time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act makes amendments. The Court found that the Explanations sought to give effect to erstwhile Sections 148, 149, and 151 but did not cover Section 147, and crucially, the procedure under the amended Section 147, including Section 148A, was not followed. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires, bad in law, and null and void. The Court reasoned that Section 3 of the Relaxation Act falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’ and deals with time limits, whereas Section 4, which amends provisions of the Income Tax Act, falls under Chapter III. The Legislature did not delegate the power to amend substantive provisions of the Act under Section 3. Therefore, the Explanations attempting to extend the applicability of erstwhile Sections 148, 149, and 151 were beyond the scope of Section 3. Additionally, the Court noted that even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed. The Court also found that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which amended the Act, was distinct from Section 3. The Court further found that even if the Explanations were considered valid, the impugned notices were invalid because they did not comply with the amended Section 147 of the Act, which requires compliance with Section 148A and no longer relies on the 'reason to believe' standard. Additionally, the Court held that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the relevant procedures.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was merely a provision for relaxing time limits and did not grant the power to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act, and no such power was delegated to the Central Government under Section 3. The Court further held that even if the Explanations were considered valid, the impugned notices were invalid because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the amended Section 147 and the mandatory procedure under Section 148A. Additionally, the Court found that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the law.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It reasoned that Section 4 of the Relaxation Act, which amended the Act, was distinct and did not delegate amendment powers to the Central Government. The Court further found that the impugned notices were invalid because they were issued based on the 'reason to believe' criterion, which is no longer recognized under the amended Section 147, and because the mandatory procedure under Section 148A was not followed. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act, which was amended by the legislature, introduced changes to the Act. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law. This was because the Explanations did not cover Section 147 of the Act, which empowers revenue to reopen subject to Sections 148 to 153, including Section 148A. The procedure under Section 148A had not been followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory procedures.

The High Court held that Section 3 of the Relaxation Act, which falls under Chapter II titled 'Relaxation of Certain Provisions of Specified Act', only deals with relaxation of time limits and does not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, falling under Chapter III titled 'Amendments to the Income Tax Act, 1961', was the provision that amended the Act, and this was done by the Legislature itself, not delegated to the Central Government. Therefore, the Explanations to Notifications No. 20/2021 and 38/2021, which sought to extend the applicability of erstwhile Sections 148, 149, and 151, were declared ultra vires, bad in law, and void. The Court also noted that even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147, including Section 148A, was not followed. Furthermore, the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act. The Court further found that even if the Explanations were considered valid, the impugned notices were bad in law because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the mandatory procedure under the amended Section 147 and Section 148A. The Court also held that the Relaxation Act was not applicable to assessment years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's contention that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Assessing Officers assumed jurisdiction based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; (b) the amended Section 147 is subject to Sections 148 to 153, including the procedure in Section 148A, which was not followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years as the time limits for issuing notices for these years were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory procedures. The Court relied on decisions of the Allahabad High Court, Rajasthan High Court, Delhi High Court, and Madras High Court.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, only deals with time limits and does not empower the Central Government to amend substantive provisions of the Act or revive repealed provisions. Chapter III, containing Section 4, is where amendments to the Act are made by the legislature itself. The Court also found that even if the Explanations were considered valid, the impugned notices would still be bad in law because they did not comply with the amended Section 147, which no longer recognizes the 'reason to believe' concept, and the mandatory procedure under Section 148A was not followed. Additionally, the Court noted that the Relaxation Act is not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act, 1961. Section 4 of the Relaxation Act, which did amend the Act, did not grant such power. The Court found that the impugned notices were also bad in law because they were issued based on the 'reason to believe' criterion, which is no longer recognized under the amended Section 147, and the mandatory procedure under Section 148A was not followed. Additionally, the Court noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, after strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were invalid; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed; (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards, as the time limits for these years were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory provisions. The Court was in respectful agreement with the High Courts of Allahabad, Rajasthan, Delhi, and Madras.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was made by the legislature itself. The Court found that the impugned notices were bad in law for multiple reasons: (a) the assumption of jurisdiction was based on the 'reason to believe' clause, which is no longer recognized in the amended Section 147; (b) the procedure under Section 148A was not followed, even if the Explanations were considered valid; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years, as the time limits for issuing notices for these years did not fall within the scope of Section 3(1) of the Relaxation Act. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Court allowed the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts in similar matters.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires the Relaxation Act and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the Central Government the power to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended provisions, was distinct and made by the legislature. The Court found that the notices were invalid for multiple reasons: (a) the Explanations themselves were ultra vires; (b) even if the Explanations were valid, the notices were issued based on the repealed 'reason to believe' concept under Section 147, and the mandatory procedure under Section 148A was not followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years as the time limits for these years were not expiring within the period covered by Section 3(1) of the Relaxation Act. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and void. The Court agreed with the Assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the section that amended the Act, and no such power was delegated to the Central Government. The Court further found that even if the Explanations were considered valid, the impugned notices were still invalid because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the mandatory procedure under the amended Section 147, which is subject to Sections 148 to 153, including Section 148A. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's contention that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act made amendments to the Act. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were bad in law because the Assessing Officers failed to comply with the amended Section 147 and the procedural requirements of Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act after strictly complying with the same. The Court was in respectful agreement with the views taken by the Allahabad High Court, Rajasthan High Court, Delhi High Court, and Madras High Court.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was distinct. The Court found that the notices were invalid for multiple reasons: (a) they were based on the repealed concept of 'reason to believe' under Section 147, which is no longer recognized in the amended Section 147; (b) the mandatory procedure under the amended Section 147, which is subject to Sections 148 to 153 (including Section 148A), was not followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards, meaning the notifications could not extend the period of limitation for these years. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not grant power to amend substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151, but did not cover Section 147, which empowers reopening subject to Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure under Section 148A was not followed, rendering the notices invalid. The Court also noted that the Relaxation Act was not applicable for assessment years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the law. The Court was in respectful agreement with the decisions of the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires, bad in law, and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act is a relaxation provision dealing with time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act. Such amendments are provided for in Section 4 of the Relaxation Act, which was enacted by the legislature itself. Furthermore, the Court found that even if the Explanations were considered valid, the notices would still be invalid because they did not comply with the amended Section 147 of the Act, which requires adherence to Section 148A. The 'reason to believe' basis for assumption of jurisdiction was also found to be obsolete under the amended provisions. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act is a relaxation provision dealing with time limits and does not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amends the Act, is distinct from Section 3. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147, which is subject to Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure under Section 148A was not followed. The Court also held that the Relaxation Act is not applicable for Assessment Years 2015-2016 and subsequent years, as the time limits for these years were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant amended provisions of the Act, strictly complying with the procedure.